S

Information Technology and Organizational

Decision MakingChuck Davies

PREMISE

The Effects of Advanced Technologies on Organizational Design, Intelligence and Decision Making

G.P Huber (1990)

Contents

Traditional vs. Advanced IT Properties of Advanced IT Decision Variables Subunit Organizational Design Organizational Memory Organizational Intelligence

Traditional IT

Operating Systems Windows 7, XP, Linux Desktops “Simple” Applications- Microsoft Office, Notepad, Quick books

Advanced Technology

Basic Characteristics Data Storage: Hard drive, removable media, tapes Transmission capacity: WAN,LAN, Wireless Processing Capacity: CPU power, database

processing, memory storage

Organizational Decision Systems

Properties of Advance Technology

Task Relevant Improve overall user performance User Support in day-to-day activities

Context of the Properties

CommunicationIt allows the ability to: Communicate more easily and less expensively across time and

location Communicate more rapidly, with more precision to targeted groups Record and index more reliably an inexpensively the content of

communication More control in the group participation selectivity in the network

Decision Aiding

It facilitates the ability to: Store and retrieve large amounts of information more

quickly and inexpensively More rapidly and selectively access information created

outside the organization More rapidly and accurately combine and reconfigure

information so as to create new information More compactly store and quickly use the judgment

and decision models developed in the minds of experts More reliably and inexpensively record and retrieve

information about content and nature of organizational transactions

Impressions

It is a mistake to view advanced technology as substitutes for traditional technology?

“IT are frequently used as supplements… rather than substitutes”

Impressions cont’d

“For example, e-mail is often used to confirm with text what was said in a phone conversation”

- Virtual Companies/Enterprises

Image Transmission devices used to digitize ALREADY available images?

Drive for IT Advancement

External Competition:The need to beet competitors with rapid communication Internal Competition:In highly politicized organizations, project leaders need

task achievement, group control and coordination on demand

They may have a reputation to keep – Apple, Google

Decision Variables

Effect at the Subunit level

Proposition 1 Use of computer-assisted communication

technologies leads to a larger variety of people participating as information sources in the making of a decision

Subunit level

Proposition 2 Use of computer-assisted communication and

decision-support technologies leads to decreases in the number and variety of members comprising the traditional face-to-face decision unit

Subunit level

According to proposition 2 the unit becomes smaller, proposition 1 states it has a larger pool of contributors

Conflict?

Conflict Solution

This paradox results from having more experts specializing in certain areas

The beginnings of an Expert System

Subunit level

Proposition 3 Use of computer-assisted communication and

decision support technologies results in less of the organization’s time being absorbed by decision-related meetings

Mini-Meeting

DSS can allow analyses that provide information which can resolve disagreements about significant effects of assumptions

Allows progress to continue without adjournment and rescheduling

Mini-Meeting

DSS, email, IM, and other technology reduce the number of formal meetings

Using technology such as Google wave, IBM Lotus Domino, etc - virtual meetings

Organizational Level

Do Advancements in IT lead to more centralization or decentralization?

Answer

It decentralizes centralized organizations and centralizes decentralized organizations!

Proposition 4

For a given organization, use of computer-assisted communication and DSS leads to more uniform distribution across organizational levels

Evening the decision making ability of each level

Proposition 5

Broadened use of computer-assisted communication and DSS leads to greater variation across organizations in levels at which the particular type of decision is made

Is there a conflict with Prop 2 (smaller groups that are homogeneous)?

Diversity vs. Homogeneity

Prop 2 states the groups will be smaller and more homogeneous

Prop 5 states that the collection of these groups throughout the organization will lead to diversity at different levels as opposed to within the group

Proposition 6 & 7

Reduces the number of levels involved in authorizing proposed organizational actions

GSS actually destroys Hierarchy problems – direct access to relevant managers and stakeholders

Organizational Memory

Prop 8 – Advanced IT leads to a more reliance on databases to store data.

Improving organizational memory and transferability.Data bases are long lasting, index able, propriety

Organizational Memory

Prop 9 – easier to use advanced IT encourages the development of in-house expert systems

These are the ultimate form of labor capitalization. Decision Trees Regression Neural Networks

Organizational Intelligence

Use of Advanced IT ultimately leads to Rapid and efficient DSS.

They identify weaknesses and opportunitiesDecisions are more accurate and timely – An

example is Heart attack diagnosis Decision Trees

Questions

Thank You /end